REA Group Limited

Good morning, everyone. My name's Alice Bennett, Head of Investor Relations, and I'd like to thank you for joining us to discuss REA Group's results for the first quarter ended 30th of September, 2025. Before we commence, I'd like to acknowledge the traditional owners of country throughout Australia. We pay our respects to Aboriginal and Torres Strait Islander cultures and to elders past and present. Today, you'll hear a welcome from REA Group's new CEO, Cameron McIntyre. Cam will then hand over to Janelle Hopkins, REA's CFO, We'll provide a brief business update and talk to the financial highlights for the quarter. Following this, we'll be happy to take any questions. And as a reminder, our quarterly numbers are top line results only, so we'll be restricted in the amount of details we can provide. With that, I'll pass it to Cam to get us started.

Thanks, Alice, and good morning, everyone. Look, it's great to be here for my first results presentation as REA's CEO. I'd just like to thank the leadership team and everyone across the business for the warm welcome that I've received this week and for their hard work in delivering another positive quarter. I'd also like to acknowledge Owen's leadership and thank him for his commitment to REA. Owen's built a talented team and his strategic vision and execution has been pivotal in cementing REA as a leading Australian technology company. Given this is my first week, Janelle's going to take you through the group's first quarter business update and financial results shortly. But before handing over, I just want to share a few initial thoughts. So, look, I'm joining REA at a time of opportunity for the business and for our team, and I'm impressed with the strength of the group, the sound strategic foundations we have, and the depth of talent and capability across the organisation. And that all sets us up with a really strong platform for the future. I'm also committed to maintaining REA's culture of innovation and its focus on delivering increasing value for our customers and for the millions of consumers who rely on the platform every month. Today's results are a demonstration of the team's hard work and discipline in what is a strategic or dynamic approach market environment. REA continue to grow revenues and deliver exceptional value supported by unrivaled audience and premium products. Our balance sheet is extremely strong and our customer relationships are deep and new technologies give us real fresh opportunities to create even more value. I am genuinely excited about the ongoing rapid advances in technology and what this offers platform marketplaces like ours. There's clear potential to drive growth, deliver even better consumer experiences and to broaden the products and tools available to our customers. In the months ahead, I'm looking forward to connecting with our customers clearly and working with the team to keep REA on its strong trajectory and catching up with many of you on the call and discuss what's ahead for the business. So with that, I'm going to hand over to Janelle to take you through the details of the quarter's performance.

Thanks, Cam, and good morning, everyone. REAs delivered a good first quarter result, underpinned by double-digit residential yield growth. Looking at the results from core operations for the quarter, revenue was $429 million, an increase of 4% on the prior year. Operating expenses from core operations increased 3% to $175 million. And EBITDA excluding associates was $254 million, an increase of 5%. Strength in underlying fundamentals and an interest rate cut in August continued to support the health of the market, with buyer demand and national house prices reaching record levels. We cycled very strong year-on-year listing comps, and as a result, buyer listings were down in the quarter. However, overall listing levels remained above long-term averages. Our customers have continued to prioritise our market-leading products and services to ensure the best results for their campaigns. Consumer demand strengthened in the quarter, with Australians visiting our platforms in record numbers, and we delivered the highest number of monthly buyer inquiries to our customers in three and a half years. To deliver on REA's purpose of changing the way the world experiences property, our clear strategy has three simple goals. Engaging the largest consumer audience with our personalized property experiences, delivering superior value to our customers with leading products and services, and leveraging unparalleled data insights as we expand our core business and build next generation marketplaces. AI supports each of these objectives and is a clear strategic focus for the business. REA's unparalleled audience, coupled with our proprietary data, place us in a unique position to harness AI unlike any other Australian property portal. We see significant opportunities And while REA has been innovating with AI for some time, our investment is accelerating rapidly. This includes the tools and services we offer to our customers, our consumer experiences, and new ways of working within our business to enhance productivity. Focusing on consumers, while this technology is moving very quickly, currently a very small percentage of our audience is using AI to access our platforms. At present, it sits at approximately We expect this will continue to evolve as the technology advances. While we are watching this closely, from a strategic perspective, we will continue to focus on maintaining and enhancing the channels and experiences that our consumers are using, including through AI. Our audience is the air we breathe, and more people are turning to realestate.com.au than ever before. New audience records were set in the first quarter. with the highest number of people ever visiting the platform, with a record 12.8 million people in August. We achieved almost 148 million average monthly visits, which is 111 million more than the nearest competitor. Let me say that again, that's 111 million more monthly visits. Further cementing our strong leadership position, our unique audience leadership gap extended another 14%, and our exclusive monthly audience increased to 6.7 million people. October's audience data is expected to show continued strength in visits. This means August, September and October are on track to record the highest number of monthly realestate.com.au visits ever. Our personalised experiences ensure property-obsessed Australians deeply engage with our platforms. In Q1, our audience spent an average of 38 minutes a month on realestate.com.au, 25 minutes longer than those visiting our nearest competitor. REA's consumer strategy is centred on converting our large-scale audience to members. Our active membership base continues to increase, up 10% year-on-year. Demonstrating the deep engagement of our active members, this valuable cohort spends 2 hours and 15 minutes on our site each month. The number of listings shared and saved by members increased 11% compared to this time last year, and our personalized property owner experiences helped drive a 35% year-on-year increase in valuable seller leads delivered to customers. Our next generation listings initiative aims to set a new benchmark in property experiences globally. The initiative has been in place for just over 12 months, and it continues to deliver new and enhanced consumer experiences and drive deeper engagement. In Q1, this included launching AI property highlights and property walkthrough videos, and we widened the reach of the make an offer feature on listings. This enables serious buyers to submit online offers to an agent directly through a listing at any time. Further unlocking the power of AI for our members, we also launched an easy to digest GenAI powered market summary to support owners in their decision making. In addition, a new immersive video hub on the app home screen will launch to all consumers in the coming weeks. Turning to our customer highlights. Record Premier Plus penetration supported strong yield growth in our residential business. And our top tier commercial product, Elite Plus, also achieved record penetration. Traction continues to build with our high performance listing solution, Lux. Additional value added in Q1 resulted in penetration almost doubling in the quarter. The new value includes an increased frequency of Lux listings at the top of searches and extending Lux listings beyond the sales campaign to include sold listings. Pro is the most comprehensive subscription in the market. As well as exclusive prospecting, reporting and workflow management tools, Pro offers agents premium branding opportunities to help drive valuable seller leads. During the quarter, agents on Pro received 31% more seller leads than agents without it. Recognising this superior value, several large franchise groups have now signed enterprise-wide pro partnerships, bringing all of their offices onto a pro subscription. For our developer business, which we have now called New Homes, Q1 highlighted continued momentum in that market, with a healthy increase in both visits to New Homes listings and in leads delivered to customers. Looking at our financial highlights in more detail for our property and online advertising business, Our residential business delivered a good result, with revenue growth of 4%, driven by double-digit yield growth, partly offset by lower listings. Q1 national new-buy listings declined by 8%, reflecting particularly challenging comparables. Melbourne and Sydney also declined, down 4% and 6% respectively, although both cities were still very strong in a historical context, recording the second highest Q1 listings over the last 10 years. Buy yield was strong, up 13% for the quarter, driven by a 7% average Premier Plus price rise, growth in add-ons, AMAX in particular, increased subscription revenue and increased depth penetration. GeoMix was broadly neutral for Q1. Our rent business saw continued growth, with revenue driven by high single-digit yield growth, partly offset by a 2% decline in listings. Revenue momentum for commercial and new homes continued in the quarter. Commercial revenue was driven by a 7% price rise and increased debt penetration, partly offset by modestly lower listings across both sale and lease. New homes revenue was also up year on year, with revenue growth outpacing commercial for the first time in four years. This reflected a 7% growth in project profile volumes, increased yield and higher display revenues. Other revenues were up during the quarter with strong growth in media display from the banking and insurance sectors and campaign agent growth from customer acquisition. Our financial services business had an excellent quarter. Investment in core broking platforms and product innovation supported increased broker productivity and broker leads from realestate.com.au also continued to rise up 33% year on year. Ongoing market strength and growth in our broker network supported a 24% year-on-year increase in submissions, which should continue to flow through to further settlements. Settlements for the quarter are up 16%, benefiting from both higher volumes and loan size. Revenue is partly offset by higher broker payout rates in line with higher volumes. And we set a new record in October with our highest ever month on record for broker submissions. Looking at our business in India, As we flagged previously, housing.com is REA India's strategic priority, and a number of recent strategic decisions will enable this business to be our sole focus going forward. The sale of Prop Tiger completed in late September, and in October, we made the decision to discontinue Housing Edge. This follows recent regulatory changes that impacted the Housing Edge offering and made the business model unviable. While exiting Housing Edge will have a negative impact to EBITDA, Noting it contributed approximately $12 million in FY25, this will enable our full focus on our strategic priority, housing.com. As a result of these changes, REA India's revenue declined 20% year-on-year. Housing core revenue saw modest growth. However, this was more than offset by a reduction in adjacency services on the Housing Edge platform as it put in additional controls on the business and lower prop tiger revenues as the business transitioned ownership. For housing.com, driving app traffic and investing in the app experience is the priority. And we've just gone through a major milestone with more than 50% of traffic coming from our app. Apps are the future of the Indian property experience and our strategy continues to deliver positive results with housing continuing to lead app downloads in India. Turning to operating costs. Group call costs were up 3%, reflecting 10% growth in Australia and a 22% decline in India. In Australia, cost growth was driven by higher employee costs from salary inflation and product development, increased COGS reflecting the more than doubling in audience maximiser penetration, higher marketing spend in part due to the timing of our largest customer event, Ready, which was not in the prior year, and increased technology costs due to supplier price rises and investment in AI tools. In India, operating costs declined by 22%, primarily driven by lower revenue-related costs attached to Housing Edge. Removing the impact of Housing Edge and Prop Tiger, group operating costs increased by 7% in Q1. The group's associates contributed a $7 million loss to core EBITDA in the quarter, in line with PCP. This reflected an improvement in moves contribution, driven by 9% revenue growth, offset by investment in Ascent Home Loans, which was not in the prior year. For more information on MOVE, please see News Corp's Q1 results release. And lastly, on the 10th of October, we acquired a 61.5% controlling stake in Canadian-based Planetar Inc., the maker of iGUIDE for $55 million. iGUIDE produces precise 3D virtual tours and floor plans, which are cost-effective and fast to produce. This is expected to complement our video-based visualisation strategy. Moving to current trading conditions. Australia's residential property market remains healthy, with strong buyer demand nationally and continued house price growth. Supply has improved in Melbourne and Sydney, which is supporting strong new listings activity, while limited stock in other cities is resulting in some vendors delaying the listing of their properties. We continue to expect national residential buyer listing volumes to be broadly flat on last year's healthy market. While listings declined in Q1 due to very strong prior year listings, comparables will become easier as we progress through the remainder of the year, particularly in Q4. October listing volumes were down 3% year on year, with Melbourne up two and Sydney increasing by 6%. The group continues to target double digit residential buyer growth including a 7% Premier Plus price rise. As always, geomix will be a swing factor, and the magnitude of yield growth may be impacted by geomix movements across the remainder of the year. Positive operating jaws are targeted. Group core operating expenses are expected to increase mid-single digits, which reflects high single-digit growth for Australia, the consolidation of iGUIDE, divestment of PropTiger, and exiting Housing Edge. Excluding those items on an underlying basis Group cost growth is expected to be high single digit. EBITDA losses in India will be impacted by exiting housing edge and are expected in the range of 40 to 45 million. And contributions from associates losses are expected to improve modestly compared to the prior year. On a final note, we're very pleased with the performance we've delivered so far this year and our business is in great shape. Comps will get easier as we move through the remainder of the financial year and market fundamentals are healthy. Leveraging REA's unparalleled data capabilities, our exciting product pipeline will continue to harness the power of AI to further enhance consumer engagement, provide increased value to our customers, and drive growth across our portfolio of assets. I'll pause there. Operator, we're now open for questions.